ICBA: Exclude PPP loans from asset calculationsICBA called on Congress to direct federal regulators to exclude Paycheck Protection Program loans from bank and bank holding company asset threshold calculations.
In letters to House and Senate leaders, ICBA noted that the surge of PPP loans has swelled the balance sheets of community banks. Absent a legislative fix, asset-size growth will inadvertently push many community bankers over regulatory thresholds and subject them to additional supervision, regulations, and costs.
Whereas banks normally have advanced notice that they are close to crossing an asset threshold and invest in a strategic plan to comply with additional regulations, rapid asset increases due to PPP lending have caused temporary balance sheet inflation.
"This is an exceptional circumstance and bank regulation must be flexible enough to account for it rationally and ensure that PPP lenders are not punished with regulatory costs simply for their participation in an emergency program," ICBA wrote.
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